LuckyRobin's Personal Finance Blog

Getting Rid of Massive Debt

About Me

Lucky Robin

I am a 48 year old stay at home mother. I have been married to my wonderful husband for 23 years, though we have been together for 26 years. Our daughter is 21 and our son is 18 and is home-schooled. We live in Washington state's beautiful most NW corner.

After thirteen long years, and nine years intensively working on it, we paid off a massive amount of medical debt, around $100K, and are now free of consumer debt since March of 2016, though we still owe my mother some money.

Viewing the 'Farm Down Payment Fund' Category

I think, barring any further unforeseen circumstances, that we are going to come out of this whole ordeal with $30,000 left in the bank. I've been going back and forth on whether or not I want to still consider that the down payment fund or just make that be the Emergency Fund and start the down payment fund over from scratch.

That might be a little disheartening. I know we won't be doing anything whether the money is called one thing or the other, until both funds are to goal, but I just don't know.

I could split the difference with $15K into each or $10K into one and $20K into the other. I know it is all semantics. I just hate having to start completely over with both.

I guess I am being silly. I need to do whatever will screw with my brain the least. I just need to figure out what that is.

I wasn't sure I was going to be able to add anything to this fund this month, but I was able to squeak out $500.00 as we spent most of the overtime money putting ourselves into a position to survive the next several months without having to purchase much and get ahead on some things.

It'll be a close next two weeks, but not tight. All payments have gone out or been scheduled and nothing else is due until after next payday on the 8th. The garden is in full swing now with both fruits and vegetables, so I really should not need to set foot in a store for anything but dairy and vitamins.

I have PT today and next Friday, but the money is put aside for that, too. So really, it all should be good. I am hoping on the 8th to purchase a 30 pound box of ground beef from the farm. That is the only thing we are low on in the freezer. If not we will just have to make due with ground rabbit and ground pork, which actually make some pretty tasty burgers, tacos, meat loaves, and meatballs. They just don't provide much iron.

We also stocked up on animal feed so we will have that on hand for a good long while.

It was a little discouraging to only put $500 into savings this month for the down payment. We've been putting away $1500 most months this year, but we had a lot of medical bills with DS's surgery come through and all the medical stuff with DD. At least we have met the deductible now, so that'll ease up. Unfortunately there was a lot of stuff that was being processed all at once so some of it we got billed for anyway because it was all "in process." So we will get checks back from the doctors who end up getting paid by us and by the insurance.

Also, we won't be able to save $1500 each month going forward, either, because of the pay cut DH was forced to take. I really don't like the way the new budget looks. We will have to be very strict if we want to save $1000 per month. I am going to try to cook more from the pantry and freezers. We will have greens soon in the garden so that will help.

I think we are going to be stuck here through 2017 now. We just won't be able to save enough by the end of this year like I'd planned on before the pay cut. I know this is a lot of whining, I am just feeling frustrated and anxious. We still don't know if the company got the new contract, which means individual contracts are still up in the air. We should know soon, but even if they do get it, it does not mean the employees will get their old wages back.

Some days I really think about just moving to rural Idaho or Montana where the cost of living is so much cheaper. But I love where we live and I don't know if I would love Idaho or Montana the same way. They are both beautiful states, but they aren't home and that is a hard thing sometimes to get over.

I think I will settle down some after the contract news. Well, if it's good. If it's bad I'll freak out for a while. I hate uncertainty. It is the worst thing for me.

I have passed the half-way point on my second mini-goal of 2016, which is to get the EF from $16K to $17K. $455.48 to go. I was hoping to have met that by the end of April, but with DH's paycut going into effect at the end of the month, I'm not sure I will. It might be the end of May.

One of the things I am debating is whether or not I should keep saving for the down payment or if I should just start shoveling everything into the Emergency Fund and if the contract is won at the end of June, then just transferring the money to the Down Payment Fund then.

It all goes into the same bank account. I know it is just a question of where to put it on the spread sheet, but I have told myself I will not touch the money in the DPF until we are ready to buy a house, unless it comes down to needing it to live on. I guess it is a mental thing.

Well, and then there is the mental thing of only touching the EF if there is an Emergency and not really even wanting to do it then. So if all goes well I still may have a psychological problem transferring the money to the DPF from the EF. I don't even know what that is. Maybe a little of my OCD coming through?

Maybe I need to set up a short term holding tank, from which I can easily move stuff later. I shouldn't have to play these kinds of mind games with myself to funnel money to the proper location. Anyone else go through these things or am I just sort of on my own there? I know it is rooted in the financial insecurity we had in the past, but I really thought I would have gotten over it by now having been out of consumer debt for almost a year.

There are 3 very nice farms for sale right now. One is utterly perfect and two are quite doable. We have enough money for a 10% down payment on two of them and will have enough for a 10% down payment on the perfect one by the end of this year. And I'm swayed quite hard in that direction.

We would be able to afford the payments, all of our expenses, and still save a little each month. It would mean being a lot stricter with the budget. We've got a lot of play right now so that could be accomplished and we'd still have some breathing room.

We'd also be in our home for the first time since 2009. There is stress in living so long with my mother, even though I love her dearly and we get along quite well. I yearn to be able to have my own kitchen and do things my way and not have to schedule around her timetable, which is erratic at best and annoying at worst when you are trying to feed a family.

If we do this now, there are no ifs, ands, or buts about doing a 30 year mortgage. We would have to. I don't particularly like that idea, though, because we have only ever had a 15 year mortgage, and a 30 year mortgage would mean we could be 75 and 76 years old when it was paid off. Oh, I'd throw more money at it as we had it, but that would probably have us finishing at 65 to 70 years old.

The thing is, the practical thing anyway, is that if we buckle down and save super hard this coming year and throw everything at our down payment fund, we could have enough for a 20% down payment by December 2016. Which means we would lower our monthly payments significantly and have a 15 year mortgage. And it would be paid off by the time we were 61 and 62 years old, with no extra payments being made. With extra thrown at it, we might pay it off by the time we are 56 and 57.

The numbers make sense to wait out another year and save like the dickens. My head says that is the smartest thing we could possibly do. My soul says it is not quite sure it can cope with another year of living only in 1000 square feet with 2 teenagers and my husband. And only one bathroom.

We simply have no space. None. The house is very large, but this is the only space she allows us to use, plus we can cook in the kitchen (but must keep all our dishes and cooking stuff in our 1000 square feet). That frustrates me, too, because she has a huge kitchen with lots of cupboard space, two large living rooms, 4 bedrooms and 3 bathrooms for just herself. And two of those bedrooms are almost empty.

I am torn. I know what makes better sense. I really do. But it has been seven years. Seven very long years. And we wouldn't be struggling if we did it now. I feel like we are struggling though with the emotional part and being packed in like sardines. I want space. I want room to move. I want freedom.

I guess the thing I need to decide is what do I want most? Financial security is so freaking important to me. It is only one more year. Yet when I think about that year it is like a massive weight pressing down on my shoulders. One of these homes could be our escape hatch.

And 2 of them have open houses tomorrow. I will take my son and go look. Maybe in person they won't be as good as they are on paper.

Also, on the money we've been holding for the guy who remodeled our old house and then immediately went through bankruptcy before we could pay him, we were finally able to make a $5000 payment yesterday and then in 21 to 28 days we will be able to make the remainder payment of $36,000. I will be so glad to not have that money in our credit union account anymore.

I mean, yes, the interest we were collecting on it was nice, but I still didn't like the situation. With the $5000 he is able to open his business account and get all the proper licensing and then when that all runs through, he can then take the additional $36,000 and put it in the business and then he can pull from that gradually as he needs income since he is allowed to pay himself a salary.

What a mess this has all been and I am really glad to see it nearly done.

I have been trying to come up with ways to stay motivated when I'm saving up and not paying down. I saw a neat thing on someone's blog (Debt Free Charts on blogspot) and while they were mainly focused on paying off debt with their charts, I took the idea and made up my own chart for my down payment.

The idea is to mark off a line every time I have added $500 to the down payment fund. This way I can have a visual representation of our savings account growing that isn't just a number. I set the goal at $80,000.

I think having the chart to fill in will motivate me. I really want something to. I put it on the back of my bedroom door so I have to see it every morning when I get up and every night when I shut the door. It will have a real presence in my life. I don't know if that presence will lead to urgency to save or not, but I have to think it will have more of a chance of doing that than doing nothing at all, right?

I'm not really sure what my goal is on this one. Most farms with 5 acres are $350,000, so $70K would be 20%, but I think I'd like to have a bigger chunk than that. I enjoy life without a mortgage and I don't want to have a huge one when we do buy. I guess for now, though $70K can be what I am aiming for with $35K being the first big milestone, since it is the halfway point.